Why you need them
The economic calendar is not just another calendar with dates and a list of events. It tells you:
When important events are going to occur
Which ones will impact forex rates the most
When certain important announcements are going to be made
The professional forex traders use these calendars to:
Consider various economic and political factors that will influence forex trading
Get advanced information about the direction of a particular currency pair
Understand current events better so they can make better forex decisions in the future
Economic calendars will not make you a millionaire with forex, but they are a valuable tool that will provide you with valuable information and insights to help you reach your goals.
Using a calendar
When you see such a calendar for the first time, you will be overwhelmed with the amount of data you have. There are literally thousands of events every week, so how do you know which ones you need to keep an eye on.
Here are a few ways to use the calendar:
Make a list of events that are most likely to affect the forex rates of a particular country
You can find this information from various new sources
Eliminate those events that you think will have little impact on forex
Check out blogs from forex experts and well-known economists to hints on which events to focus on more
Even the most seasoned forex traders cannot predict 100% which events will have the most significant impact on currency rates between two countries. However, we you get more and more experienced, you will get deeper insights into how two unrelated events can heavily influence forex rates.
Important releases
As a rule, here are some of the announcements and reports that routinely influence foreign exchange rates between the US and other countries:
Consumer confidence index
Consumer credit report
Consumer price index
Durable goods report
Employment situation report
Existing home sales report
Jobless claims report
Mutual fund flows
Money supply
All of these are important markers of the health of the American economy. Even if the overall trend goes one way or another, you can track every report to come up with decent predictions by following them closely. You can then use the insights gained in order to invest smartly in forex and gain healthy profits.
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